As it has passed through the House of Commons there have been various amendments to the Employment Rights Bill and it is now making its way through the House of Lords where further amendments may be made. In anticipation of it becoming law, Claire Treacy takes a look at what those changes are and what they will mean for employers.
Unfair Dismissal Rights from Day One
This is the change that has arguably caused most concern for employers. When the Bill comes into force and employees have unfair dismissal rights from the day they start work, probationary periods will take on a new importance, with a new legal framework (which hasn’t yet been disclosed) governing how dismissals can be carried out fairly in those early months of employment.
We are also still waiting for confirmation of the compensation levels for employees claiming unfair dismissal early in their employment. The Government has indicated that a different financial cap will apply to dismissals during the probationary period, not the current cap of £115,115 (rising to £118,223 in April).
Bereavement leave and pay for pre-24-week pregnancy loss
The Bill already contains provisions to convert the existing right to statutory parental bereavement leave to a more general form of bereavement leave, although, as currently drafted, it would not apply in the event of pregnancy loss before 24 weeks. However, an amendment has been tabled to extend the existing parental bereavement leave rights and although the amendment has not been accepted as yet, the principle of bereavement leave for pregnancy loss has been and it may be that further amendments are made to grant this right.
Redundancy and collective consultation
Currently an employer making redundancies across multiple locations can often avoid triggering collective consultation obligations where there are fewer than 20 redundancies are proposed at each location. The first draft of the Employment Rights Bill removed the ‘at one establishment’ rule entirely meaning all redundancies across the business would count towards the threshold for collective consultation and therefore, potentially requiring more businesses to carry out the more onerous collective consultation duties.
However, the latest amendment to the Employment Rights Bill has cast doubt on this. Further clarity about when collective consultation duties will be triggered is now set to be announced in later regulations. The speculation is that instead of the threshold being whether 20 or more redundancies are proposed across all locations, the Government will instead introduce a business-wide threshold based on either a percentage of the workforce or a set number of redundancies.
For now we will have to wait and see what thresholds are announced, but what businesses can be clear on is that collective consultation obligations are still likely to apply to far more businesses than they currently do.
Fire and re-hire and collective redundancy consultation
The Government has been adamant that it intends to all but ban dismissals on the basis of fire and re-hire. Where a business intends to make 20 or more redundancies at anyone of its locations (although note the change referred to above) which includes dismissals on the basis of fire and re-hire employees can make a claim for what is known as “the protective award” if collective consultation obligations are not carried out or not carried out properly.
“The protective award” is currently a claim for up to 90 days gross pay for each employee but the Bill will amend this to increase the award to 180 days gross pay to encourage employer compliance.
Employers will therefore need to be far more alive to the risk of getting collective consultation obligations wrong and not understanding the new thresholds for when these obligations apply.
